It’s your right to decide who will benefit from your hard-earned money and assets. You may choose to give it to someone unrelated, or you may want to prevent someone else from benefitting. Nevertheless, everything must be as per your wishes and feelings. One way to ensure it is by writing a Will.
Your Will gives you power over your possessions even after you’re gone. You can leave your instructions in the Will, which your beneficiaries and executor must follow no matter what.
One of your many instructions in the Will is the gifts and charities. You can leave a portion of your wealth to charities you want to support.
How can you do that, and what options do you have?
Let’s learn the proper steps to do it!
Table of Contents
4 Types of Gifts
People want to do noble things. However, we get busy with other things and may forget to give back to our community. It is a big regret for many people. So they choose to help through their Wills.
It’s a great way to make a positive impact on society. Big or small, you can include gifts to your chosen charities in four different ways.
1. Residual Gift
The first type of gift to leave behind is the residual gift. This is the most common way to include a gift to a charity.
A residual gift is when a Will-maker chooses to leave the remainder of their estate after distributing the majority to the essentials. The essentials could be the inheritance to the family and loved ones, Will-maker’s funeral arrangements, debts, etc.
2. Pecuniary Gift
The second type of gift is the pecuniary gift, also called a specific gift. It is when you leave a specific property, shares, or amount of money to a charitable cause. There’s no ambiguity here, as you will be stating clear-cut details.
3. Whole Estate Gift
The next type is the whole estate gift. As the name itself suggests, this gift comprises your whole estate. It is usually chosen by those with no family or preferred beneficiaries.
4. Fractional Gift
The last kind of charitable gift you can include is a fractional gift or percentage gift. With this gift, the Will-maker explicitly states a percentage of their estate that needs to go to a charity.
While dividing the estate by a percentage, you need to take some factors into account that may change the estate value. They are inflation, property fluxes, and changes to the composition of the estate.
Contesting Charitable Gifts
Though charitable gifts have noble intentions, beneficiaries may still contest the Will after the death of the Will-maker. So to ensure it doesn’t happen, it is important to consider family provisions in the succession law.
In a nutshell, if a Will-maker provides sufficient for the beneficiaries, they might not contest the Will. For example, if a person leaves only a small portion of the estate to his adult son while gifting the lion’s share to a charity, the son may want to contest it. He has a justifiable reason to do it.
Therefore, it’s crucial to satisfy the beneficiaries first to ensure the smooth fulfilment of your noble intentions.
Longevity of a Charity
Say a person left a major share of their estate to a charity, which was in operation during the time of Will making. However, it does not exist at the time of the Will-maker’s death. In this case, who will get the gift?
When a charity bequest in a will is unsuccessful, the Court may arrange a “cy pres” plan to transfer the failed donation to a similar charity cause. To achieve this, the Court must determine that the decedent intended to administer the donation to charity with a benevolent motive.
Therefore, it is better to leave alternate instructions if your first charitable donation is unmet. You can also seek a solicitor’s advice and learn your best course of action.
Consider the Jurisdiction
The concept of “freedom of testation” is preserved all over Australia. The common agreement is that only you have the authority to determine how to divide your estate.
The best way to ensure the fulfilment of your intentions is to speak with a succession lawyer for legal counsel regarding your particular circumstances. As each State has its unique laws governing succession, it is incredibly crucial to take professional advice.
Will Creation
Now that you have understood all possible angles of charitable gifts take a look at the process of Will creation also. Simply put, there are six steps to it.
- Choose your beneficiaries: You can think of all the people as well as your favourite charities you want to benefit from your estate.
- Decide your distributions: Now you have to decide what portion of your estate goes to whom/what. For example, you have seen the list of gift types you can give to a charity.
- Pick an executor: Your executor ensures fulfilling your wishes even after you’re gone. If you do not have anyone, you can select a state Trustee, who will receive a fee from the estate.
- Write the Will: It is advisable to write the Will with a solicitor’s help to ensure it is legally valid. The professional will let you know about the Will and QLD Probate in detail.
- Sign: You need to sign the Will in the presence of at least two witnesses who must be over the age of 18 years. After you sign, the witnesses also need to sign with the same pen and date the page.
- Store it in a safe: Give your executors a copy of the Will and store one copy with you somewhere safe.
Final Say
Gifts to charities are noble. If it is your wish to help a cause, it should happen. However, it is your responsibility to follow all the steps needed to make the Will valid, so your wishes are fulfilled. Don’t hesitate to see legal counsel, as it is invaluable in these cases.
Probate Consultants is one of the best solicitors you can find. You can get all the information regarding estate planning, Will making, and Grant of Probate in SA.
We hope the matters of charity through Wills are clearer now to you. Feel free to comment if you have any questions.
